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Jahangiri Sets Out Economic Agenda

First Vice President Es’haq Jahangiri said making improvements in the business environment is a prerequisite to any development, while outlining the prospective government’s economic agenda.

“If we want to do serious work on development projects, in which the private sector is an integral part, the business environment must take steps toward betterment,” he said, stressing that there’s need to cut red tape and reduce bureaucracy.

Jahangiri, who is also one of the candidates running in the May 19 presidential election, said if elected president, his Cabinet will see changes compared with the one currently in office.

Iranians will be casting votes in less than a fortnight to elect their 12th president since the Islamic Revolution of 1979. The winner from among the six candidates will shoulder the responsibility of handling economic, political and foreign relations at a highly critical juncture in the country’s history.

Iranians expect the elected president not only to be able to safeguard the achievements arrived at over the past four years but also to further improvee people’s living conditions and the country’s international ties.

To make known where he stands on the abovementioned topics, Financial Tribune’s sister publication Donya-e-Eqtesad has interviewed Jahangiri.

Heir to Turmoil

Jahangiri noted that international sanctions on the one hand and gross mismanagement inside the country on the other had put Iran in a peculiar position. “We were experiencing difficulties in the international arena. The sanctions were imposing more and more limitations on our economy by the day, especially in the fields of banking, finance, oil and gas and transportation,” he said.

“To make matters worse, officials inside the country had no plans or strategies to battle the sanctions or neutralize its effects as much as it was possible. We were in turmoil.”

For instance, he says, the value of rial fell to a third over the previous government, inflation hiked to around 40% and economic growth plummeted to minus 6.8%.

“All in all, we were caught up in an unprecedented stagflation. Under such conditions, almost all economic variables were rendered unpredictable. We had an obscure picture of where we were or where we were going regarding the state of foreign exchange, inflation, investments and production. So naturally, back then, candidates’ campaigns revolved around a reform plan in both national and international affairs,” he said.

Jahangiri added that today these goals have been arrived at and no one sees Iran as a threat to global peace anymore and the economy is stable.

“Right now the private sector can predict the foreign exchange rates, banking interests and where the inflation is going. These are determining factors for undertaking economic activity. With all these available now, it is clear that the other candidates have nothing in particular to say, and therefore, seek recourse to exaggerated slogans and empty promises,” he said.

Resistance Economy: Inclusiveness, Extroversion

Citing World Bank data, Jahangiri said Iran is now the world’s 18th biggest economy and as a result the volume and value of imported and exported goods and services are considerable.

“We need to make our economy resistant to potential negative influences from outside the borders. For this, the economy needs to be both inclusive and extrovert. Inclusive economy is defined as one where local capacities and capabilities are focused on and efficiently utilized. Among these [capacities] are geographical location, manpower, mineral resources and factories that must be fully taken advantage of,” he said.

Alongside inclusiveness, a resistant economy needs to be extrovert as well, meaning that a great economy like ours cannot and must not be confined within its borders. It has to link up with the world through dynamic interactions.”

The seasoned politician believes are three main factors contribute to an extrovert economy. First, he says, we need to expand our export of products and services. Fortunately, during the fiscal 2014-15 and 2015-16, exports exceeded imports. As such, Iran’s trade balance became positive for the first time in the history of the Islamic Revolution,” he said. “Second, we must fulfill our need for financial resources through foreign investments. For example, the Oil Ministry needs around $200 billion to carry out its basic oil, gas and petrochemical projects. It is obvious that this sum cannot be derived from domestic financial resources.”

Jahangiri said many countries are technologically advanced and can help us in this respect. “Four years ago, resolving the nuclear dispute was our priority, but this time round safeguarding the nuclear deal and making Iranians feel its positive effects in their lives is our main objective … Moreover, the private sector has to be given the space to play a more prominent role in the economy. Domestic policy, culture, art and the state of universities are other priorities.”

Jahangiri concluded by saying that he believes Iranians will continue the path they chose in 2013. He believes there have been shortcomings in the incumbent government and that people’s complaints are justified, but the same path has saved the country from the tempest it used to be in.